Options and Futures in Market Risk Management for Financial Entrepreneurs in USA & Europe
Abstract
Derivative markets have, over time, become increasingly important in the world of finance and banking. The two main products that are traded in the derivatives market are options and futures. Since they are derivatives, they do not have value on their own; their value comes from an underlying asset. It is therefore possible to see that options are far better when it comes to managing risk associated with price movements. This is due to the fact that they are more accessible, flexible as well as capital efficient. Furthermore, they provide unique opportunities and can be used for both hedging and speculating due to the fact that they allow for advanced strategies.
Keywords: Options, Futures, Market Risk Management & Financial Entrepreneurs
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